Abaxis Shares Plunged: What You Need to Know (ABAX)

Abaxis Shares Plunged: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of blood-analysis specialist Abaxis (Nasdaq: ABAX ) were bleeding profusely today, falling as much as 12% in intraday trading after the company reported fiscal third-quarter results.

So what: As compared to the December quarter of 2010, Abaxis' revenue climbed 5% to $37.9 million, led by 9% growth in sales of consumable products. The company's profitability, however, slipped and net income fell 26%, while earnings per share dropped 24% to $0.13. Both the top and bottom line missed analysts' expectations, which called for $0.16 in per-share profit on $40.7 million in revenue.

Now what: Will the coming quarters treat Abaxis any better? Abaxis management seems to think so. CEO Clint Severson laid part of the blame for the soft results on a slowdown in the European markets as that region has battled with a rocky economy. He noted, however, that the company expects "to see a more stable business environment in our European markets in the coming quarters." He also pointed to growth in reagent disc unit sales as a sign that the company is continuing to build a solid market position.

Of course, with shares currently trading at 46 times expected fiscal 2012 earnings, you have to believe in particularly strong growth ahead to justify the stock's valuation.

Want to keep up to date on Abaxis? Add it to your watchlist.

The Steve Jobs Betrayal
You may already know that in the final year of his life, Jobs revealed a stunning betrayal — and told his biographer, "I will spend my last dying breath... and every penny of Apple's $40 billion in the bank to right this wrong." What was it that made Jobs so irate — and why could it make a few in-the-know investors some major profits over the coming months and years?

Enter your email address below to find out what made Jobs so enraged!

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

Fool contributor Matt Koppenheffer does not have a financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or Facebook. The Fool's disclosure policy prefers dividends over a sharp stick in the eye.

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment icon found on every comment.